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I highly recommend Lacie hard drives. They are extremely reliable. I have a bad history with Western Digital, and several other big name companies, they just don't last. Lacie has a wide variety of hard drives, to fit all different kinds of computers. It really comes down to what you are looking for, or what you need. Do you need/have USB 3.0? Does your Device have Thunderbolt? Is this going to be a sitting in a fixed location, or are you going to be carrying it around?

I have the Lacie Porsche Design P'9223. I got it because the 128GB SSD on my actual computer is very small. It has USB 3.0 so the transfer speed is great. However, if your device does not have USB 3.0 then make sure you pick up the USB 2.0 option.

You pays your buck and takes your chances as all hard drives fail sooner or later. Shop around for the best value and best warranty. Seagate were offering five years some time ago. Currently, OEM is three years.

Hang on to those original install discs like grim death! Using OS X.7 or later make a bootable USB thumb drive before running Installer!

You can, but IMO you'd be wasting your money on buying a drive that's USB 3.0 capable since your machine can only do USB 2.0. Unless you're planning on buying a new machine soon, I would look for a USB 2.0 external drive. You should be able to find one on sale from an on line reseller.

All the current generation of external drives are going to be USB 3. Don't think any of the major players are still making USB 2 drives, so you'd have to find someone that still has some last gen drives in stock. Everyone has had those WD passport drives on sale recently at very good price points - I picked up a 500 GB one so the wife could start keeping a clone backup along with the TM backup I already had running. We'll see how good they are as time goes on.

I cannot be held responsible for the things that come out of my mouth.
In the Windows world, most everything folks don't understand is called a virus.

The aforementioned drive is USB 3 but claims it's USB 2 compatible. I checked the documentation and it comes with a USB 3 cable.

If I were to purchase it how do I connect it?

USB 3.0 is backward compatible with USB 2.0 so the drive will run at USB 2.0 speeds. As for the cable, you must use the cable supplied because USB 2.0 cables are not compatible with the USB 3.0 female connector on the drive. However, the other end (male connector) is the same for USB 2.0 and 3.0. In other words, it will work with the ports on your Mac.